Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Deering Inc. incurred the following costs to open a new manufacturing facility for its new product line in 2 0 2 3 . Required: Determine

Deering Inc. incurred the following costs to open a new manufacturing facility for its new product line in 2023.
Required: Determine if each item/cost should be capitalized as land, buildings, equipment, or land improvements or if the item/cost should be expensed.
(a) Cost of parking lots
(b) Cost of demolishing an old building that was on the land when purchased
(c) Replacement of a minor broken piece of equipment
(d) Freight on equipment
(e) Cash paid for land and an old building
(f) Excavation costs for new building
(g) Landscaping costs (useful life of 15 years)
(h) Installation and preparation costs of equipment
(i) Cost of surveying and grading of land
(j) Salary of the company's president
(k) Architect's fees for constructing building plans/designs
(I) Attorney fees and recording fees related to purchasing land
(m) Interest on loans during building construction
(n) Installation of fences around the manufacturing facility
(O) comission fee paid to the real estate agency
(p) land assessment by city
(q) equipment purchase including sales tax
(r) delinquent real estate taxes kn property assumed by the purchaser
(s) insurance costs while in transit
(t) ordinary repairs (maintenance and oil changes on equipment)
image text in transcribed

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Financial & Managerial Accounting, 1, 2 Terms (12 Months)

Authors: Carl S. Warren, James M. Reeve, Jonathan Duchac

14th Edition

133727075X, 9781337270755

More Books

Students also viewed these Accounting questions

Question

=+What is the brand's character or personality?

Answered: 1 week ago